On the comparative advantage of U.S. manufacturing: Evidence from the shale gas revolution

Rabah Arezki, Thiemo Fetzer and Frank Pisch

Journal of International Economics, 2017, vol. 107, issue C, 34-59

Abstract: This paper provides novel empirical evidence of the effects of a plausibly exogenous change in relative factor prices on U.S. manufacturing production and trade. The shale gas revolution has led to (very) large and persistent differences in the price of natural gas between the U.S. and the rest of the world reflecting differences in endowment of difficult-to-trade natural gas. Guided by economic theory, empirical tests on output, factor reallocation and international trade are conducted. Results show that U.S. manufacturing exports have grown by about 10% on account of their energy intensity since the onset of the shale revolution. We also document that the U.S. shale revolution is operating both at the intensive and extensive margins.

Keywords: Manufacturing; Exports; Energy prices; Shale gas (search for similar items in EconPapers)
JEL-codes: L71 N52 O13 Q33 R11 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (20)

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Related works:
Working Paper: On the comparative advantage of U.S. manufacturing: Evidence from the shale gas revolution (2017)
Working Paper: On the comparative advantage of U.S. manufacturing: evidence from the shale gas revolution (2017)
Working Paper: On the Comparative Advantage of U.S. Manufacturing: Evidence from the Shale Gas Revolution (2016)
Working Paper: On the comparative advantage of U.S. manufacturing: evidence from the shale gas revolution (2016)
Working Paper: On the Comparative Advantage of U.S. Manufacturing: Evidence from the Shale Gas Revolution (2016)
Working Paper: On the comparative advantage of U.S. manufacturing:evidence from the shale gas revolution (2016)
Working Paper: On the comparative advantage of U.S. manufacturing:evidence from the shale gas revolution (2016)
Working Paper: On the Comparative Advantage of U.S. Manufacturing: Evidence from the Shale Gas Revolution (2016)
Working Paper: On the Comparative Advantage of U.S. Manufacturing: Evidence from the Shale Gas Revolution (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:inecon:v:107:y:2017:i:c:p:34-59

DOI: 10.1016/j.jinteco.2017.03.002

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